Revealed: The S&W shareholders who stand to gain from IPO

Wealth Manager loves a long shareholder list, so we contacted Companies House to find out who owns – and will benefit most from – the potential flotation of Smith & Williamson. Selin Bucak reports.

Smith & Williamson traces its origins back to 1881 and has been through a number of iterations since, so it is perhaps no surprise that there are over 700 individual listings of shareholders on its register – so big that you actually have to order it on a CD Rom!

We then printed out all 103 pages to look at the main individuals holding shares in the business, which at least one estimate suggests is worth £600 million. There are 55 million shares in issue (see box below) which would suggest, on a very back of the envelope basis, a value of around £10 a share.

According to the company's latest internal valuation, disclosed in its results for the 12-months to April 2017, the price of an ordinary share was £6.080, compared to £5.440 the previous year.

The same results reveal that the firm paid a total dividend of 32p per share. This is compared to 29p paid in the previous two years.

Here we looked at a sample of those who own more than 1%.

Gareth Pearce Interestingly, one person who holds a significant number of shares is former chairman Gareth Pearce, who combined with family member Virginia Louise Pearce, has 1.6 million shares in the company.

Pearce retired in 2013, after 27 years with the group. During his tenure as managing director, a position he took on in 1995, the company grew its income to £186 million from £27.5 million.

Markham Cannon Brookes

Another former director who has a 2% stake in the business is Markham Cannon Brookes.

Brookes is well known for being a founder of the Gulls’ Eggs City Luncheon and has 1,095,291 shares in the company held together with Nicola Brookes.

He was also one of the signatories of a letter that suggested Britain’s competitiveness was being undermined by EU membership ahead of the Brexit vote.

In addition, an investment management company he is the chairman of, CG Asset Management, holds 147,828 shares in Smith & Williamson.

Former staff

Other former employees with a lot to gain from an IPO include ex-group finance director Jeremy Boadle, who retired at the end of last year and was replaced by Grant Hotson. Boadle also holds over 1 million shares in the company.

In March, director of financial services at Smith & Williamson Mike Fosberry also left the company, after accumulating 994,500 shares during his 35-year tenure.

He joined Smith & Williamson back in 1982 and established its financial services practice.

Another former employee who will receive a substantial pay out if the company floats, is Graham Healy, who joined Smith & Williamson in 1983. Along with Louise Healy, he has 896,500 shares in the company.

Current partners

Another long-term employee of the company who has been rewarded is Simon Mabey, who has been with the firm since the early 1990s.

Mabey, who is a partner and senior tax adviser at the company, has just over 1 million shares, making him the only current employee to hold as much.

From the current board, others who hold significant stakes include the co-CEOs David Cobb (pictured above) and Kevin Stopps.

Cobb, together with Jane Elisabeth Cobb and Helen Elisabeth Cobb, have a total of 869,254 shares. While the Stopps family holds a total of 859,084 shares.

Plans to sell

It is likely that former directors and employees of the company will want to sell at least some shares on a potential flotation – after all they have in many cases owned shares for a long time.

Also, it is only right they should reap the reward for their patience and the success of the company.

Many existing director/shareholders will also want to realise part of their investment, although normal practice would be for there to be some restriction on share sales to keep key people incentivised to remain with the group.

Either way, the company has been a great success and should reward its loyal long term investors.

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